Despite an economic slowdown, 4J Property Co Ltd says it remains confident in the serviced apartment market in the Phahon Yothin area, underscored by its 100-million-baht budget for Abloom, a renovated building.

President Lerdpol Bhakdibhumi said the company in 2007 completed a facelift of the former Luecha Exclusive Place, a 12-year-old apartment on Soi Phahon Yothin 3, and officially launched the serviced apartments yesterday.

"In the first years after I took over the operation from my parents, the occupancy rate was only 20-30%," said Mr Lerdpol, who is also a director of the 51-year-old Sahachart Sethakit Co Ltd, a family-owned gypsum mining manufacturer.

"I've gradually adjusted the management policy until occupancy was 70-80%. Then I decided to change it into a serviced apartment as there is no supply in the location, compared to an oversupply in the Silom and Sathon areas."

The former graphic director of the television series producer X'act said that Bank of Ayudhya supported the facelift with a project loan. The company expects to recoup its investment after 10 years with a target occupancy rate of 80% a year.

"It may seem risky to run a serviced apartment in the midst of an economic slump but it's harder to start from the beginning," he said.

"We believe there's a market in the area and hope for an economic recovery in the future. We will not spend much on marketing and advertisement but will focus on word-of-mouth strategy."

Abloom, situated on a three-rai-plot, has two buildings of 21 and 12 storeys with a total of 67 rooms. Currently, it has an occupancy rate of around 50%.

After the renovation, room rates increased from a range of 20,000 to 60,000 baht a month for units between 50 and 300 square metre to a range of 45,000 to 158,000 baht.

The target tenants for the apartments are expatriates and long-term tourists.

source : www.bangkokpost.com